If you are an influencer getting paid for your testimony on a product, an advertiser trying to promote a brand or an affiliated marketer who is promoting a product or service, it is your responsibility to understand your limitations and be knowledgeable about what you can or cannot post. You should always go to a legal professional if you have any questions or concerns about the content in question. Still, many resources, groups, and organizations can help social media professionals educate themselves on social media regulations. The Federal Trade Commission is one of these organizations that can be used as a guideline before creating posts for a brand. Within this blog are a few critical regulations from the FTC you can read in order to educate yourself as an influencer, advertiser, or affiliated marketer.

What is the FTC?

The Federal Trade Commission is a federal agency that is tasked with protecting consumers from false advertisements or misguided promotions. Their goal is to ensure that consumers are aware that they are viewing a paid promotion so they can make a purchasing decision that is not misled.

How can the FTC help you self-regulate?

According to their website in July 2024, the FTC’s mission is: “To protect the public from deceptive or unfair business practices and from unfair methods of competition through law enforcement, advocacy, research, and education.” The FTC is a great resource to use to make certain you are not violating any laws when you are promoting a product or service. While I won’t be listing all of the regulations that the FTC has in place, I will discuss some of the key regulations that any social media professional should be informed about. 

Disclosures 

If you endorse a product or service through social media, your endorsement message should make it obvious that you have a relationship with the brand. This relationship can be personal, family, employment, or financial. This relationship should be obvious to your followers because it allows the consumer to weigh the value of your endorsement. Ambiguous disclosures are not good enough and can still lead to deception. It is advised to use straightforward language that clearly communicates the relationship. The FTC aims to stop deceptive ads, and they even provide an endorsement guideline that you can use to make sure you are not breaking the law.  As an influencer or an affiliated marketer, it is your responsibility to make these disclosures and have a basic understanding of these endorsement guidelines. The image below is an example of an influencer including a disclosure on her TikTok post. You can see at the bottom of her post says “sponsored,” meaning she is being paid by Luvs to post about their products. 

Honesty and Authenticity

When you endorse a product or service, you must be honest. It is against the law to talk about your experience with a product you have never tried, lie about liking the product you tried, or make claims that cannot be proven. Under the Federal Trade Commission Act, advertising must be truthful and non-deceptive, advertisers must have evidence to back up their claims, and cannot be unfair.

Responsibilities of Advertisers 

Sellers are responsible for the claims about their product or service, but third parties, like advertisers, are liable for making the deceptive advertisement if they are aware of the deception and distribute the ad anyway. Advertising agencies are responsible for reviewing the information used in the advertisement. This means that the ad agency should always ask for proof from the manufacturer of their claims. The ad company should only proceed with the manufacturer if evidence is given.  In determining whether an ad agency should be held liable, the FTC looks at the extent of the agency’s participation in preparing the ad in question and whether the agency knew or should have known that the ad included false claims.

Penalties 

The penalties depend on the nature of the violation. The remedies that the FTC or the courts have imposed include:

• Cease and Desist- These are legally binding orders that require companies to stop running the ad and could force the company to report periodically to FTC staff about the substantiation they have for claims in new ads
• Civil Penalties and Fines- These can range from thousands of dollars to millions of dollars. The company could also be forced to give full refunds to all consumers who bought the product. 
• Corrective Advertising – The company could be forced to take out new ads to correct the misinformation in the original ad. This could lead to a bad reputation for your brand because you have to publicly expose your dishonesty. 

Conclusion 

If you advertise online, it is important to remember that although the Federal Trade Commission is tasked to protect consumers, it also helps businesses maintain the credibility and authenticity of their products and services. As an influencer or an advertiser, it is crucial for you to be informed of these regulations and take them seriously. One mistake can cost a company millions and can cost you, your career. If want to learn more about the regulations listed above or more regulations that I did not touch on, visit their site and become more familiar with your limitations. 

 

Author: Taylor Munghia

Social Media Strategist Intern

Taylor Munghia worked as an intern for the National Institute for Social Media, and recently earned her Social Media Strategist certification. She is a recent graduate from the University of Southern Mississippi with a bachelor’s degree in business with an emphasis in marketing. She is also educated in social media content and strategy.